We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ODP or ULTA: Which Is the Better Value Stock Right Now?
Read MoreHide Full Article
Investors interested in Retail - Miscellaneous stocks are likely familiar with ODP Corp. (ODP - Free Report) and Ulta Beauty (ULTA - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, ODP Corp. has a Zacks Rank of #1 (Strong Buy), while Ulta Beauty has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ODP is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
ODP currently has a forward P/E ratio of 9.18, while ULTA has a forward P/E of 20.33. We also note that ODP has a PEG ratio of 0.66. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ULTA currently has a PEG ratio of 2.30.
Another notable valuation metric for ODP is its P/B ratio of 1.85. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, ULTA has a P/B of 13.17.
These metrics, and several others, help ODP earn a Value grade of A, while ULTA has been given a Value grade of C.
ODP is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ODP is likely the superior value option right now.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ODP or ULTA: Which Is the Better Value Stock Right Now?
Investors interested in Retail - Miscellaneous stocks are likely familiar with ODP Corp. (ODP - Free Report) and Ulta Beauty (ULTA - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, ODP Corp. has a Zacks Rank of #1 (Strong Buy), while Ulta Beauty has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ODP is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
ODP currently has a forward P/E ratio of 9.18, while ULTA has a forward P/E of 20.33. We also note that ODP has a PEG ratio of 0.66. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ULTA currently has a PEG ratio of 2.30.
Another notable valuation metric for ODP is its P/B ratio of 1.85. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, ULTA has a P/B of 13.17.
These metrics, and several others, help ODP earn a Value grade of A, while ULTA has been given a Value grade of C.
ODP is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ODP is likely the superior value option right now.